Walt Rubel Commentary: Impossible task for new committee

Sen. Bill Soules of Las Cruces is co-chairman of the newest and most important interim legislative committee, the Federal Stabilization Subcommittee.

They’ve been tasked with figuring out what we’re going to do when the federal government cuts off funding to the state, either as retaliation for policies it disagrees with, or as a result of massive cuts now being considered as part of the Big Beautiful Bill (their name, not mine).

According to a report by Source New Mexico on the subcommittee’s first meeting, the state’s $33.16 billion budget for the current fiscal year includes $14.4 billion in federal money. The Health Care Authority is the most dependent, with nearly three-quarters of its budget coming from Washington D.C. They will be the most vulnerable to proposed Medicaid cuts in the bill.

When you include our national labs and military bases, New Mexico leads the nation in money coming in versus going out. We take in $3.21 for every $1 sent to the feds.

While the state clearly benefits from those percentages, it has come at a cost. Our residents have never been compensated for the death and illness that followed the atomic blast at Trinity Site. And even today the federal government looks to New Mexico for nuclear waste storage.

None of which changes the fact that we’re in a bind. Our state’s economy is overly dependent on the oil and gas industry and the federal government, and both sources may be heading for a steep decline.

State Finance Secretary Wayne Propst said if the bill that passed the House were signed into law, the state would lose $290 billion in food assistance funding and see a decline of more than 4 percent in the federal oil and gas royalty rate, along with the cuts to Medicaid.

I applaud the Legislature for taking a proactive approach to prepare as best we can for the devastation that is to come, but I fear it won’t make it much less devastating.

Gov. Michelle Lujan Grisham has had an amazing run. The state budget went from $7.1 billion in her first year to $33.16 billion this year. But that trend is about to end, and whoever wins the seat next year will face far greater challenges.

There are a lot of people who depend on the enhanced services the state has been able to provide with its annual increases in new revenue. They are the ones who will be hurt the most by these cuts.

Unlike the federal government, the state is not allowed to have a budget deficit. We have to balance our books. During Bill Richardson’s administration, that meant clawing money back from school districts. We’re not there yet, but there are a lot of difficult choices ahead.

State lawmakers were wiser than I gave them credit for at the time when they stashed much of the new revenue into funds dedicated to specific services. That will help cushion the blow.

But if the federal government is determined to usher in a new era of austerity in order to pay for tax cuts to the rich, the impact on New Mexicans will be devastating.


Walter Rubel can be reached at [email protected]

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